[Weekly funding roundup April 12-18] VC inflow declines to 2nd lowest level for the year

Venture capital (VC) funding into Indian startups dropped to its second lowest level on a weekly basis for the year till now as the uncertain macroeconomic environment continues to be an overhang on the ecosystem.

VC funding for the third week of April came in at just $62 million across 23 deals. In contrast, the previous week saw a total funding of $209 million.

The only other time that VC funding was lower than this level was in the first week of January when the amount stood at just $14 million. This is also the third time that the VC funding on a weekly basis has dropped below the $100 million level, as per Yourstory Research.

This low figure of VC funding shows the serious challenges that the Indian startup ecosystem continues to face from both external and internal factors. The tariffs dispute has only worsened the situation, while domestically there is a perceptible slowdown in the economy.

Just two startups raised more than $10 million this week. It is unlikely that there will be any recovery of sorts anytime soon.

On the other hand, the Indian startup ecosystem continues to be positive in the long run as companies like PhonePe and Razorpay have taken their next step to become public limited firms, which is necessary for an IPO.

At the same time, the developments around mobility startup BluSmart have caused an unfortunate stain on the ecosystem.

Key transactions

Drone startup Garuda Aerospace raised Rs 100 crore ($11.6 million approx.) in a round led by Venture Catalysts.

B2B commerce platform Ofbusiness raised Rs 100 crore ($11.6 million approx.) from Cornerstone Ventures.

Deeptech startup Optimized Electrotech raised $6 million in a round led by Blume Ventures and Mela Ventures.

Magma, a B2B startup raised $5 million from Capria Ventures, General Catalyst, Accion Venture Lab, and WEH Ventures, and Avinya Ventures.